The B-schools are strenuously talking up their ethics programs, but there's no evidence that all the studying will prevent more Enrons.

A businessman is counting the daily receipts and observes that a customer has mistakenly paid $1,000 instead of $100. It sinks in on the guy that he faces an agonizing ethical question: Should he tell his partner?

Hey, it's a joke. And possibly a better joke than the tired line about business ethics being an oxymoron. (Late count from the Nexis database on that one: 295 articles.) No joke now: The public preoccupation with business ethics and strenuous efforts by business schools to capitalize on the Enron-Adelphia-WorldCom era with courses about right and wrong. We are being asked to believe that proper training can prevent the next malefaction.

A large volume of ethics training is at issue, given that the country's business schools churn out some 100,000 M.B.A.s a year. Dean Robert Harris of the University of Virginia's B-school says it is up to institutions like his to begin "restoring confidence in corporate America." The business school at the University of California's Berkeley campus is creating something called the Socially Responsible Business Leadership Initiative, identified as a response to the current "crisis in corporate ethics." Among other things, the Berkeley initiative will include field trips to various prisons, where students can see for themselves what happens to ethically deficient executives.

Also favoring a major new role for ethics professors is George W. Bush, who got his M.B.A. at Harvard, and said in his July 9 speech on Wall Street: "Our schools of business must be principled teachers of right and wrong, and not surrender to moral confusion and relativism."

I recently spent a fair amount of time debriefing assorted business school eminences involved in ethics programs--at Virginia, Berkeley, Harvard, Wharton, NYU and Northwestern--and came away deeply dubious of the schools' ability to do anything meaningful about the kind of ethical lapses now on display. The schools confront two formidable difficulties:

1. The sleazeball population is far less malleable than is assumed in all the talk about business schools as restorers of confidence.

2. The "discipline," if ethics teaching can even be called a discipline, is hollow.

The evidence is not even clear that honesty pays. It probably can be shown that extreme dishonesty is unremunerative; Andrew Fastow, if the terrible things that the prosecutors say about him prove to be true, will not have a comfortable retirement. But how about honesty as a preacher might define it?

The first sleazy businessman I ever heard about was Billy Rose, the impresario then famed for Jumbo, a show incorporating live elephants and Jimmy Durante. When I was a child, my mother shopped at the same grocer that serviced the Rose household. This was the threadbare Thirties and, to caricature the situation only slightly, everybody but Billy was broke. What my parents kept talking about was his nasty habit of running up huge bills at the grocer, then offering to settle for 60 or 80 cents on the dollar. The guy was an instinctive chiseler, one of those characters who go through life telling themselves that only suckers pay up all the way, and one guffaws at the notion that they can be turned around by business-school professors.

Our legal system gives corporate chiselers a fair amount of maneuvering room. Bankruptcy law is such that Donald Trump could, last fall, entertain the casino world with a running soliloquy about the possibility of his defaulting on Trump casino bonds if their owners declined to renegotiate the coupons. (To his credit, he backed down from the fierce talk and paid the interest.) Now consider Ira Rennert, who, according to a recent revelation in this magazine, owes much of his prosperity to buying back at huge discounts the bonds his troubled companies had earlier sold (FORBES, July 22). Or Meshulam Riklis, who has controlled a fair number of companies over the years and acted as though his main enemy in life is the shareholder he is supposed to be serving or the bondholder he ought to redeem (FORBES, Sept. 30). Legal? Entirely. Ethical?

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